Cuyamaca Granite Co. v. Pac. Paving Co.

Belcher, C. It is alleged in the complaint in this case that at all the times mentioned therein, both the plaintiff and defendant were corporations, organized under the laws of this state; and that in 1889, A. Has-kins and A. It. Schulenberg made and entered into a certain contract of copartnership with the defendant, a copy of which is set out and marked “ Exhibit A.” This contract was to the effect that Haskins and Schulenberg would use their best endeavors to secure from the city of San Diego contracts for bituminous rock street pavements in that city, and in the event of obtaining any such contracts, would immediately assign and transfer the same to the defendant; that upon such contracts being secured and assigned, the work therein provided for should be done by Haskins and Schulenberg and the defendant as partners; that the defendant, at its own expense, would appoint a book-keeper, who should keep all accounts, pay all bills, and collect all moneys belonging to the copartnership; and that the profits arising from the work should be equally divided, one half to Haskins and Schulenberg, and the other half to the defendant. It is then alleged that in pursuance of the terms of the said contract of copartnership, Schulenberg, on behalf of Haskins and himself, procured from the city of San Diego, in December, 1889, a contract for the paving and curbing of Sixth Street in said city, and assigned the same to the defendant; that the work provided for was done as agreed, and was completed and accepted by the [255] city on or about July 25,1890, the said partnership being in effect thereby dissolved; that the total value of the work performed under the contract amounted to the sum of $51,680.72; that, in January, 1891, Sehulenberg assigned and transferred all his interest and claim in and to the said contract, and the profits arising therefrom, to the plaintiff; “ that no settlement of the copartnership accounts has ever been made between plaintiff and defendant, nor between Haskins and Sehulenberg and defendant, nor between said Haskins or said Schulenberg and defendant, though plaintiff has requested and demanded a final settlement of defendant with respect thereto, which defendant has refused, except on terms unjust and unfair to plaintiff, and not in accordance with said contract”; that plaintiff is informed and believes that upon a true and just settlement of said accounts a large sum of money, to wit, about fifteen thousand dollars, would be due from defendant to plaintiff; and that according to plaintiff’s information and belief, there is outstanding and due from various persons to said copartnership concern about nineteen thousand dollars; and that defendant, assuming that it has the sole and exclusive right to collect the outstanding claims, at such times and in such manner as suits its convenience, and to postpone the settlement of the partnership accounts between it and plaintiff until said outstanding accounts are all collected, refuses to make any settlement with plaintiff, though requested so to do. And the prayer is for an accounting, for the appointment of a receiver to collect the outstanding de'mands, and for judgment, etc. The defendant demurred to the complaint, on the grounds,—1. That there was a defect of parties plaintiff, in that A. Haskins was a necessary party to the complete determination of the several matters and things complained of; and 2. That the complaint did not state facts sufficient to constitute a cause of action. The court sustained the demurrer, and, the plaintiff [256] declining to amend, gave judgment for the defendant, from which plaintiff appeals. 1. It is clear, we think, that the demurrer was properly sustained upon the first ground specified therein. It appears that Haskins and Schulenberg were partners with defendant in the street-paving contract, and were jointly interested with defendant in the profits arising therefrom. The plaintiff, by the assignment, succeeded only to Schulenberg’s interest in these profits, and was thereafter jointly interested in them with Haskins. No settlement of the partnership matters had ever been made between any of the parties. It is apparent, therefore, that no complete determination of the controversy could be had without the presence of Haskins. This being so, he was a necessary party, and should have been brought in. (Code Civ. Proc., sec. 389; Harrison v. McCormick, 69 Cal. 620, 621.) If his consent to be joined as plaintiff could not be obtained, then he should have been made a defendant, the reason therefor being stated in the complaint. (Code Civ. Proc., sec. 382.) 2. We also think that the demurrer was properly sustained upon the second ground specified. It appears that it was expressly stipulated in the agreement made between Haskins and Schulenberg and the defendant, that the defendant should appoint a book-keeper, who should collect all moneys becoming due under the contract with the city, and that the sum of about nineteen thousand dollars remained uncollected when this action was commenced. It is not averred that the defendant had failed to perform any of the conditions of the agreement to be performed on its part, or that it was neglecting or refusing to collect the unpaid money, or that it was insolvent or likely to become so, or unable or unwilling to respond to any just claim or demand against it, or that there was any danger that the money, when collected by defendant, would be by it misappropriated, squandered, or lost. Under these circumstances, we fail to see how any right of action had arisen in favor of the plaintiff, when this action was instituted. [257] We advise, therefore, that the judgment be affirmed. Vanclief, C., and Haynes, C., concurred. For the reasons given in the foregoing opinion, the judgment is affirmed. Paterson, J., Harrison, J., Garoutte, J.